US Markets

We’ve become cautious on US equities, strategist says

Expert: Market action seems to strike cautious tone
Expert: Market action seems to strike cautious tone

Valuations have gotten so expensive in the U.S. stock market that Deutsche Private Wealth Management has become "cautious," its chief investment strategist Larry Adam told CNBC on Monday.

Those valuations have been driven by the optimism about what President Donald Trump and congressional Republicans can deliver on tax reform, deregulation and infrastructure spending.

However, events like Monday's hearing on alleged Russian election interference are an example of what can put those promises on hold, Adam said in an interview with "Closing Bell."

"That's really starting to create a logjam down in Washington, which may prevent Washington from really focusing on the more substantive policy issues like tax reform and infrastructure going forward," he said. "If that doesn't happen, that will actually disappoint the market."

Closing Bell Exchange: Market has run out of ideas
Closing Bell Exchange: Market has run out of ideas

While the is about 11 percent higher since the election, stocks have really been trading sideways lately, trader Peter Costa pointed out.

He thinks that's because there are no compelling ideas out there right now for investors to get excited about.

"People have blindly put money to work and it's been successful since mid-November, but at some point, that money, it's going to have no place to go," the president of Empire Executions and CNBC contributor told "Closing Bell."

"There's no percentage gain going forward, so people, they're pulling back a little bit. They're just waiting to see if there is some story."

However, Cassandra Toroian, president and chief investment officer at Bell Rock Capital, said there are a lot of compelling reasons to stick with the stock market.

"You do have to put a thinking person's cap on to find the right ideas but if you haven't been invested in this market you have done your client a huge disservice," she told "Closing Bell."

U.S equities closed mixed on Monday, with the Dow and the S&P slightly down and the Nasdaq just about flat, up 0.01 percent.